After working in the auto finance industry for over 12 years, I saw clear trends and analyzed data which supported the theory that specific periods of time are better for buying a new vehicle. It is often said in life that it is all about timing, and when making a major purchase, such as for a vehicle, that philosophy does not differ.
The ultimate cost factor is still the vehicle itself; if you want something luxurious, you will pay for it. However, there is money to be saved depending on the time of year, month, week, and even time of day. There are also a few other factors which will be discussed, and naturally if there is a best time, then there should also be a worst time.
End of the year
At the end of season, you can usually find a good deal. Quotas need to be hit for annual reporting, and next year’s models are about to be released. End of the year falls during the winter time, and this is another good time to buy. Car sales are much lower during the snowy season, probably because consumers do not want to get their shiny new car dirty in all the snow slush. However, the reality is that this is the time to buy a new car.
End of the month
The end of the month is always a good time to buy a car, new or used. After working for so many years in the auto finance industry, I can attest to how crazy month end would get in terms of pushing volume. Not only are dealers pressured to make sales, but so are the financial institutions. At TD Auto Finance, lunches are always paid for in the final week, and employees are asked to work through their lunches and take minimal breaks to secure their targets.
During the middle of the week
On the weekends, it is time to sell for a car salesperson. Saturday and Sunday are the most popular, and busiest days of the week for most dealerships. People can make a day of it, as they do not have to work and can spend extra time shopping around. Yes it is convenient, but remember, if the dealership is packed with potential customers, dealers can be more picky on who they help. If you are trying to haggle too much on the price of a vehicle, they can move on to the next customer in minutes. This is why it is best to shop during the middle of the week when the dealership is less busy. For example, going to buy a car on a Tuesday evening is definitely better than going Saturday afternoon. I will talk about this more in the next point…
End of the day
Deals can often be found towards the end day. The reason for this is because often car salesmen are tired, want to go home, and are ready to move a vehicle at a lower cost to save time. They know that if you walk out the door because of time constraints, the likelihood that you’ll be back decreases significantly. Therefore, they’ll try and get you to sign the paperwork even if it means dropping the price.
Alternatively, going first thing in the morning is also a good time
If you get into the dealership right when the doors open, you might find a salesperson looking to start their day off right by closing a deal. In sales, they often say, the first sale will set the tone for the remainder of the day. If they can close early, and fast, it will give them more time and confidence to boost their daily volume. In this scenario, you might be able to walk away with a cheaper deal than expected.
After a next generation model comes out
Periodically, vehicles go through a redesign and phase out the old model, into a new one. For example, the Toyota Corolla is on its 11th generation model, and the 12th generation Corolla (2018) is soon to be released. Most car manufacturers do this to appeal to their consumer base, and to stay on top of motor trends. When the 12th generation Corolla comes out, the 11th generation models will decrease in value a little bit because they are no longer the most current version.
When are the worst times to buy a new car?
If there are optimal times to buy a new car, then of course there should be times that are the worst in terms of saving money. With that being said, sometimes you’re in a pinch, and need to buy a car right away depending on your family situation or line of work.
Spring is probably the worst time to buy a new car, for a few different reasons:
- Weather: the weather plays a factor, as people want to get out and drive their new vehicle once the snow melts away and the sun glistens down on your new paint job.
- Abundance of stock: This is around the time new models are released and the stock on hand is very high. With any new technology, it is more expensive the newer it is.
- Not as much pressure on the sales people: It is early in the year, and quotas need to be met eventually, but not just yet. When you know in the back of your mind that you have plenty of time to sell cars, you can relax a bit as there is much less pressure. Trying to bargain with a sales person in this situation can be tricky, as they do not have much incentive to cut you a deal.
After applying to a bunch of places
If you are seeking car financing, and you shop around be careful of how many applications you fill out. Each time you apply for a car loan, lenders will access your credit bureau, and this can actually have negative recourse. The more you apply to, the more hits to your credit bureau. Lenders and dealers will see this, and you might get a higher interest rate as a result. The lesson to be learned here is to apply when you know you are ready, or use a tool like our Quick Approval tool found in our navigation. This can save you a major headache when the time finally comes to buying your new vehicle.
One popular question I have seen come up multiple times reading through forums, and talking to dealers, is that “If spring is the worst time to buy, why is it the most popular?”
The reason for this is because dealerships will often offer cash incentives, or lower interest rates during this time to offset the additional cost. So be wary of this, and try to cut through the sales pitches, special offers, and get right down to the raw pricing.